HDFC Bank reverses gains, falls 2% after Anup Bagchi's appointment as CEO

HDFC Bank share price today: HDFC Bank shares reversed early gains on Monday and fell 2 per cent after the private lender appointed Anup Bagchi as its next chief executive and managing director. The private lender’s shares opened in the green at ₹731.95 and hit a high of ₹734.20 in early trade, up 1.8 per cent, on the NSE. However, the stock failed to hold on to its early gains as the session progressed and touched an intraday low of ₹707.30, down 2 per cent.

As of 11:20 AM, HDFC Bank shares were trading close the day's low, quoting ₹708.15, with more than 36 million equities changing hands. In comparison, the benchmark Nifty 50 index traded 0.30 per cent higher at 22,460. Earlier on Thursday, the Reserve Bank of India (RBI) cleared his name to lead the country's largest private sector lender.

Brokerages have welcomed the appointment of Anup Bagchi, saying leadership stability will support investor sentiment. Management change to aid investor sentiment Calling Bagchi an "all-round banker with experience across BFSI verticals", Motilal Oswal Financial Services said that the changes in the leadership team will help address the overhang and aid investor sentiment. It expect the bank’s operating performance to improve from FY28E onward, supported by a recovery in loan growth and margins.

The brokerage currently estimates earnings to grow in mid-teens in FY28E after sluggish trends over FY24-27E. It has maintained a 'Buy' rating on the stock, with a target price of ₹925, implying an upside of 28 per cent from the previous close of ₹721. READ MORE: HDFC Bank: Anup Bagchi at helm lifts overhang; brokerages share outlook Emkay Global said that the RBI approval to Anup Bagchi's appointment is broadly in line with market expectations and media reports.

The brokerage believes the appointment should help restore investor and customer confidence, given that Bagchi is a banking veteran with experience across diverse responsibilities within the ICICI Bank group. Key priorities for new MD The brokerage said that key priorities for Bagchi would be to ensure stability in the upper management; revive deposit growth; improve the productivity of newer branches; upscale technological and digital capabilities to match leading peers; and strengthen processes to move beyond past issues, including instances of mis-selling. READ MORE: HDFC Bank's succession settled, but Anup Bagchi faces execution test "This appointment should remove the prolonged overhang around management succession and help restore customer and investor confidence in the bank," the brokerage said.

'HDFC Bank stock should see a sustained re-rating' Emkay added that given the prolonged underperformance of HDFC Bank shares, the valuation has become attractive, and the stock should see a sustained re-rating as the new leadership delivers on key priorities and geopolitical uncertainty-led FPI outflows moderate or reverse. It has reiterated Buy rating on HDFC Bank stock, with a target price of ₹1,225. The target price implies an upside of 70 per cent from the previous close of ₹721.

HDFC Bank shares have significantly underperformed peers over the last few years. The stock price has declined by 25 per cent in the past one year and 8 per cent in the past five years. HDFC Bank stock performance 1 year Who is Anup Bagchi?

Anup Bagchi (56), who has been associated with ICICI Bank and its subsidiaries since 1992, will succeed Sashidhar Jagdishan, whose six-year stint in the corner office was marred by allegations of unethical conduct and questionable governance practices towards the end. He will take over as the MD and CEO from October 27, and the appointment is for three years. Bagchi is an alumnus of IIT-Kanpur and IIM-Bangalore.

He has been serving as managing director and chief executive of ICICI Prudential Life Insurance since 2023 and served as executive director of ICICI Bank for six years. Before that, he was overseeing both retail and wholesale banking.